Risk Disclosure

QU:ANION PTE LTD.

Effective April, 1st 2026

This Risk Disclosure applies to all Customers who connect a Galaxy provided by Qu:anion to their Copy Account by way of Copy Trading. It does not constitute an exhaustive statement of all risks and does not replace independent legal or financial advice.

1 General Risk Warning

Trading forex and CFD contracts via Copy Trading involves a high level of risk. You may lose part or all of the capital committed to your Copy Account; depending on the terms of your Broker, a loss exceeding the capital committed cannot be ruled out. The past performance of a Galaxy is not a reliable indicator of future results.

2 Not a Broker, No Investment Advice

Qu:anion is neither a broker, a bank, nor an asset manager, and does not provide individual investment advice. The Copy Account is held exclusively with the broker chosen by the Customer; Qu:anion does not execute trades and does not hold customer funds.

3 Leverage Risk

Trading replicated via Copy Trading is typically leveraged. As a result of leverage, even small market movements can lead to substantial losses, which may occur rapidly.

4 Technical Risk / Copy Trading Delay

The transmission of a Galaxy’s trading signals to the Copy Account depends on the technical availability of the Platform, the Broker, and the internet connection. Delays, interruptions or discrepancies between the Master Account and the Copy Account (e.g. due to differing execution prices, slippage, or server latency) may result in differing outcomes.

5 Drawdown Risk

Automated trading strategies can trigger a large number of transactions within a short period and may result in substantial drawdowns. Fluctuations of 50% or more cannot be ruled out in respect of the strategies offered by Qu:anion.

A distinction should be drawn between relative drawdown and real (absolute) drawdown. Relative drawdown describes the percentage decline measured against account size or trading volume; real drawdown describes the actual amount, expressed in account currency. During periods of heightened market volatility, relative drawdown may at times appear significantly higher, while real drawdown remains comparatively low. This discrepancy can lead to increased risk in the case of capital-financed or credit-financed amounts (for example, accounts wholly or partly funded by borrowed capital, credit, or leveraged financing), because even a comparatively moderate real loss can, where financing levels are high, result in a substantial burden on, or the complete loss of, the equity capital committed. Customers who fund their Copy Account, in whole or in part, with borrowed or credit capital should be aware of this additional risk and should structure the financing of their trading account with particular care and conservatism. Qu:anion generally advises against credit-financed capitalisation of the Copy Account.

6 Martingale and Progression-Based Trading Approaches

Individual Galaxies may, in whole or in part, be based on Martingale or other progression-based approaches, whereby the position size of subsequent trades is increased following a losing trade in order to offset previous losses upon a profitable trade. This approach can deliver stable results over a limited period, but carries the structural risk that an adverse, sustained price movement may lead to an exponential increase in the position size committed and, consequently, to very substantial losses, up to and including the total loss of the Copy Account. The longer a losing streak continues, the greater the capital required to “absorb” the streak; if such capital is not available, forced liquidation (stop-out) will occur.

To reduce this risk, certain positions within the Galaxies provided by Qu:anion are hedged, in order to limit the loss potential of individual positions or chains of positions. In addition, a classic, aggressive Martingale approach is, as a general rule, not employed; instead, a so-called “smooth Martingale” is used, applying comparatively small step-up factors typically in the range of approximately 1.12 to 1.45 per level. Compared to classic Martingale approaches (which frequently apply a factor of 2.0 or higher), this more moderate progression factor results in a significantly slower increase in position size during a losing streak.

This combined approach of hedging and smooth Martingale has, in the past, performed well within the strategies applied by Qu:anion — including during difficult or volatile market phases — and has led to comparatively controlled outcomes. This does not, however, constitute any guarantee or warranty as to future events or results. Even a smooth Martingale approach employing hedged positions may, in the event of extraordinary market occurrences (such as news shocks, extreme volatility, liquidity shortages, or failures of broker infrastructure), result in substantial losses, up to and including the total loss of the capital committed.

7 Running Streaks (Winning and Losing Streaks)

Trading strategies — including the Galaxies provided by Qu:anion — may exhibit both extended winning streaks and extended losing streaks. A positive streak observed over a given period is not an indicator that this trend will continue; equally, an ongoing losing streak does not necessarily mean that a reversal is imminent. Customers should not assume, particularly during an ongoing losing streak, that losses will “correct themselves”, and should monitor their margin position with particular care during such periods.

8 Incorrectly Configured Leverage

The leverage set with the Broker for the Copy Account is determined by the Customer or its Broker, not by Qu:anion. Leverage set too high relative to the account size and the selected Galaxy may result in even small price movements — which would ordinarily be immaterial to the strategy — triggering a margin call or stop-out, even though the strategy would likely have performed unremarkably had leverage been set correctly.

Particular attention should be paid to the following: if the leverage on the Copy Account is set lower than the leverage on the underlying Master Account, an identical position size transmitted via Copy Trading will result in a correspondingly higher margin requirement on the Copy Account than on the Master Account. This can result in a margin call or forced liquidation (stop-out) at the Broker on the Copy Account, even though the Master Account, at the same point in time, still has sufficient free margin available and shows no corresponding strain. It is therefore essential to ensure that the Copy Account carries the same leverage as the Master Account of the relevant Galaxy before activating a Copy Trading connection.

The Customer is solely responsible for aligning the leverage of its Copy Account with the leverage of the relevant Master Account and with Qu:anion’s recommendations before connecting to a Galaxy, and for reviewing this on an ongoing basis.

9 Incorrectly Configured Copy Trading Factor / Lot Multiplier

When setting up the Copy Trading connection, the Customer determines a factor or multiplier by which the position sizes of the Master Account are transmitted to the Copy Account. A factor set too high results in positions being traded on the Copy Account disproportionately to the account’s actual size; this can increase margin requirements considerably beyond the level intended by the relevant Galaxy and substantially increase the risk of loss, up to and including forced liquidation. Conversely, a factor set too low may prevent the strategy from achieving its intended effect. The Customer is solely responsible for carefully selecting the Copy Trading factor by reference to the actual account size and the specifications of the relevant Galaxy, and for reviewing it on an ongoing basis.

10 Withdrawals of Capital During Open Positions

The trading strategies provided by Qu:anion may hold positions open over an extended period. Withdrawals of capital from the Copy Account while positions are open should therefore be made with particular caution:

1. a) Reduction of available margin — if capital is withdrawn from the Copy Account while positions are open, the margin available for those positions is reduced accordingly. The remaining free capital available to absorb price fluctuations decreases.
2. b) Increased risk of a margin call — if margin falls below the minimum threshold required by the Broker, this may trigger a margin call, requiring additional funds to be deposited in order to maintain the positions.
3. c) Risk of forced liquidation (stop-out) — if the margin call is not met in time, or if the remaining capital is insufficient, the Broker may automatically and forcibly close open positions (stop-out) — regardless of whether this would be economically sensible at that particular time. This can result in realised losses that could have been avoided had prices subsequently moved more favourably.
4. d) Impact on the trading strategy — insufficient margin may force the trading strategy to close positions prematurely or at unfavourable times, which can adversely affect actual performance.

Customers should therefore, as a general rule, plan any withdrawal of capital with due regard to open positions and the current margin position, and should, where possible, consult with the relevant Broker or account manager before making a withdrawal. In particular, a withdrawal should not be made without considering its effect on the remaining margin and the risk of forced liquidation.

11 Automatic Adjustment of Trade Sizes to Account Size

The position sizes of a Galaxy are, as a general rule, automatically and continuously adjusted on the Copy Account to reflect the current account balance (dynamic lot sizing, or an automated trading factor). This means that as the account balance increases through profits, future positions are automatically traded at a larger size; as the account balance decreases through losses, future positions are automatically traded at a smaller size. This mechanism has the effect that, as the account balance grows, the absolute risk (in account currency) grows proportionately, without any change to the relative or percentage risk of the strategy.

Important: this automatic adjustment to the account balance occurs solely on the Customer’s Copy Account, and not on the Master Account of the Galaxy. The Master Account continues to trade independently of the individual performance of any given Copy Account, applying its own, constant position logic. As a result, the actual risk exposure of a Copy Account, measured in monetary terms, may diverge significantly over time from the originally intended magnitude, in particular where profits are not withdrawn over an extended period.

Customers who leave profits untouched on the Copy Account over an extended period are, in effect, trading with continuously increasing position sizes and correspondingly increasing absolute loss potential.

Recommendation (not investment advice): to limit absolute risk, it is advisable, once a profit of approximately 30–40% has been achieved on the Copy Account, to withdraw part or all of the profit generated (having regard to the guidance in Clause F.10 on capital withdrawals during open positions) and to use the capital withdrawn to open a second, third or fourth Copy Account, in order to follow the same Galaxy, or further Galaxies, again with a position size corresponding to the original capital commitment. In this way, the uncontrolled build-up of absolute capital risk on a single account can be prevented, and the total capital is spread across several independent accounts. This constitutes a general recommendation only, and not individual investment, legal or tax advice; the specific implementation remains the sole responsibility of the Customer and should be aligned with the Customer’s personal risk tolerance.